2 Brunswick Internet cafes file lawsuits over closings

Two Internet sweepstakes companies in Brunswick County are suing the towns and agencies involved with shutting them down.The companies, in separate suits filed May 22 in Brunswick County Superior Court, claim enforcement agencies seized their operations without proper review. They are also seeking a refund of fees paid to the towns since 2010, when municipalities statewide were allowed to increase the fees charged for operating a sweepstakes business.The suits are part of the larger legal battles and backlash sweeping the state since bans on sweepstakes gambling took effect in December. The ban prompted District Attorneys Ben David and Jon David, who together represent New Hanover, Pender, Brunswick, Columbus and Bladen counties, to send a joint letter in January to law enforcement confirming they would prosecute violations related to sweepstakes laws.The crackdown shut down the operations of the plaintiffs in the cases – Internet Cafe and Sweepstakes in Leland and Calabash. State records list the same registered agent for the two sweepstakes parlors. The suits allege the towns and the county’s sheriffs and the district attorney’s offices did not properly inspect the operations to see if they were in compliance with state law. The complaints say the companies reached out to enforcement agencies but were not given their due process. The operations do not violate the rules under the new laws, the suit says.“The defendants have refused to conduct a review ... in order to determine compliance with applicable law because they hope instead to intimidate,” the suit says.Also listed in the suit is the complaint that the privilege license fees, yearly charges based on the number of machines at a store, were upped to oppressive and unconstitutional levels.The Calabash store is looking for a refund of $76,900, and the Leland store is seeking a refund of $43,850 over the course of two years.“(The) collection of unlawful privilege license fees was an abuse of (the towns’) discretion,” it reads.Keith Anthony, an attorney with Morrisville-based Morningstar Law Group who represents the companies, said he could not comment on the lawsuits.“Our clients have not authorized us to answer any questions directly,” Anthony said.The defendants in the two cases are being represented by the N.C. Attorney General’s office, according to Libby Carlisle, assistant to Jon David. The state filed a motion on July 5 to get the cases dismissed, she said. Noelle Talley, spokeswoman for the attorney general’s office, said that in the region the department is also handling another case in Elizabeth City.“We believe the law and the ruling are clear, and we’re vigorously defending their enforcement,” she said. In New Hanover County and Pender County, Samantha Dooies, assistant to Ben David, said she is not aware of any lawsuits involving her office.She said that enforcement would continue.“The District Attorney’s Office continues to enforce the laws concerning sweepstakes throughout the district and encourages business owners needing guidance about the laws to seek legal counsel,” she said.Elsewhere in the state, Anthony said he represents several other clients.“There are currently, including these two, six of them that we have filed statewide,” Anthony saidWhile the civil cases are pending, there have been some criminal cases in which rulings favored the former sweepstakes owners. On Tuesday, a District Court judge found a Jackson County convenience store manager not guilty on a misdemeanor charge of operating sweepstakes machines at his store, according to a news release from his attorney.Two defendants have also recently been acquitted in District Court cases in both Catawba and Macon counties, and a lawsuit in Macon County seeks an injunction declaring that specific machines do not violate the North Carolina statute, but it hasn’t been resolved.